This resource is hosted by the Nelson Mandela Centre of Memory, but was compiled and authored by Padraig O’Malley. It is the product of almost two decades of research and includes analyses, chronologies, historical documents, and interviews from the apartheid and post-apartheid eras.
21 Oct 1994: Cronin, Jeremy
POM Jeremy, first of all could you give me perhaps an overview of the last six months, since the election? What have been the interesting developments in the government, what have been the main features?
JC The main features over the last six months? I think, I'm not sure if I said this the last time, but I think three challenges have been facing up over the course of the year. The one has been to secure, just in terms of the security side of it, rudiments of a democratic dispensation in the constitution, bringing political order. That was the key challenge at the beginning of the year. It was under grave threat from a combination of rightwing forces. I think we've made good progress on that front, the elections themselves and post-election. I think the government of national unity for a start has held together, under some strain but it has held together, and is working quite well in fact. It's hard to put a finger on it very accurately, but I think that we're living in times in South Africa, something intangible like the concept of vast number of whites who would never have voted for Mandela, feel a certain kind of pride that they have got this internationally renowned personality. That kind of moral sense of achievement which is pretty widespread through South Africa, including a large number of whites who had been frightened and uncertain.
The levels of political violence have gone down very dramatically. Last year over 4000, some 4300, about 4200 people died political deaths last year. So, about 4200 political deaths last year. There is still some residual political violence mainly in Natal but it's tailed off massively since the election and the extreme right wing has either just evaporated, in the shape Gqozo, Mangope, or is very much alive in the shape of the Terre'Blanches and so forth. Generally right-wingers are locked into the system. Gatsha is a sort of unguided missile but nonetheless he is inside and when he stormed into the TV studio not so long ago there was widespread criticism but everyone was careful not to call for his firing out of the Cabinet which by rights would have happened the next day in any democracy, but in this situation everyone understood that it was more important to have him inside rather than outside. And the other Inkatha ministers, some of them have actually proved to be quite effective and quite balanced, I think of a person like Ben Ngubane. So, briefly, that first core challenge of stabilising the situation and building up a raw consensus for some kind of democratisation, that's happened, it's a reality, it's a tangible reality and I think that's something very important.
The second challenge was to have elections but six million people are still unemployed, both before and after the elections. There are millions of homeless people. Just look at the crime rate, it's certainly not subsided. It went down a little bit round the election but has now escalated once more. But all the social and economic problems remain, hence the Reconstruction and Development Programme. I think that's the other very important success but from a SACP point of view, the ANC went into elections not just on a token blank cheque but upon a programme and quite an elaborated programme.
The second challenge has been to try to build a national and international consensus around that broad perspective and again I would say that post-elections have been a real success in that regard, but a very wide range of forces from Al Gore through John Major through to big business in South Africa through to the original grassroots, the opponents of the Reconstruction and Development Programme, there's a consensus that there needs to be an RDP.
POM Would you regard that as being a socialist document?
JC No. I would say it has the possibility of being socialist oriented document and I'll come to that in a moment. But what I'm saying is that before the elections it was being dismissed as socialist or usually as unrealistic, demagogic, populist, typical election promises. We've turned that round so that it's hegemonic, everyone genuflects to the initials, virtually everyone genuflects to the initials RDP with varying degrees of sincerity of course and with varying agendas, but they're doing it which is important and in doing that what they're saying is that housing, job creation, health care, housing people, all of those things are absolute priorities, are things that we have to focus the national mind upon. And international forces are agreeing with that, again with varying degrees of sincerity. That's important. But first is that there are many who say RDP but think RIP or think other things, but they will try to give the envelope marked RDP a very different content from the one that the ANC developed for the election. And that's the third challenge, to safeguard the broad integrity of the Reconstruction and Development Programme. And that's the big challenge at the moment in my view, the core challenge. I could elaborate what I mean by defending the integrity of it.
POM We've been going around the country for the last two weeks and all I hear about the RDP is that most people have no idea what it is, especially in the rural communities. It is subject to different interpretations that this is a government programme. For example, the IEC were very effective during the elections in getting the whole meaning of democracy across to the masses through the media.
JC Yes I think that's the first problem which is a communication problem, a mobilisation problem even around the issue, in the way that we mobilised people around democracy, there was a very high electoral turnout, remarkably high. That's not being done, that's not being done for several reasons. I think, one, because there is a lack of coherence about what it is in the places that could drive it and that lack of coherence revolves around a number of things. I think first of all if you look at the document itself, the 80 page, whatever it is, document. To be coherent, it says that we have a chance but the chance or premise of doing something about the social and economic crisis in South Africa, but that chance is premised upon having a fairly coherent effort at using what resources are primarily within our function. So that's the first one, coherence.
The second point is that it's not a five year plan, God's plan or whatever. It needs government coordination but it rests upon unleashing energy at all times, popular energy and also the private sector of contracting it into the process of reconstruction and development. So it's not, it's a governmental coordination effort that relies on energies of a variety of plans. And that's where the first wobble starts to happen because I think there is a tendency first of all within government to see it as a government delivery programme and therefore as a narrow budgetary issue. First of all people have either heard about the RDP but don't see how they fit into or simply haven't heard about it because people who have the means in their hands to popularise it don't see the need to popularise it because they think they are going to be doing it and it's just a question of finding the resources and the resources keep getting blocked.
So from our perspective, and I'll talk about some of the mechanisms that we're trying to put in place, we're trying to get what the document says, a people-driven RDP process up and running. So that you need a government, a friendly government, well disposed to the RDP which brings some resources to bear on the process, but you don't sit and wait for some department to arrive and deliver school feeding or whatever, you try to organise people around those issues using many of the traditions that we have got from the anti-apartheid era and provide them with a more developmental ethic, popular mobilisation, a developmental ethic. But there are kind of bureaucratic tendencies, including even within the ANC itself, not just there but including the ANC, which kind of rub against that perspective, that's a problem. Then related to that, taking you back then to the three challenges that I was talking about, but first we have to extend the honeymoon really, the democratic honeymoon and the genuflection to the RDP honeymoon.
The third one is a bit different, it's about driving a process, using popular ... and the democratic government jointly to try and transform and I think that understandably there is a concern that we will undermine the first two achievements, particularly the first achievement, if we push too hard. I think that the ANC led government is doing a good job but it's been treading on tiptoes around some of the core issues that sooner or later have to be confronted because the RDP, as I said earlier, is essentially about redistribution and restructuring so that Japanese soft loans or the promise which has yet to be delivered of US loans or whatever, are all very helpful in principle, I mean one needs to look at the fine print, but in principle those are helpful contributions. But you are not going to sustain a reconstruction and development programme inside South Africa that is reliant on outside investments for any number of reasons. There are resources in South Africa, maybe not enough but we are not desperately short of resources. One example, we spent more on education last year than the entire gross national product of Tanzania, but the literacy rate in Tanzania is better than it is in South Africa, so that gives you a glimpse, insight in this example of the kind of resources, educational resources, budgetary resources that they're going into a very fat bureaucracy, they're going into white suburbs rather more than black ones. So one needs a reconstruction and redistribution effort with existing resources, whether it's land, housing, education, health. In all of those areas the resources are floating around but they are mal-distributed, they are following the sort of irrigation lines of the old apartheid system and will continue to do so unless you begin to transfer.
Restructuring also, one is talking about restructuring the bureaucracies, and that's awkward, you rock the boat, the incumbents don't want to be shifted, they don't want to have to change. We're going to have to do it carefully. I'm not saying smash it all down and start again because the first achievement is a very important one. You can't have a reconstruction and development programme in Bosnia or Rwanda and we could go that way because that first challenge and achievements which we deserve, but not at any cost. You can so fall in love with that achievement that you mark time and it's to get that balance right which is a difficult one.
POM Is it not a big problem here for those guaranteed their jobs, yet at the same time you've got to find a way to bring your own people in, but without their cooperation ...?
JC Absolutely and that's what's happening. There are something like 300 different categories in the public service and that's inherited, as you say, from 14 different bureaucracies here, 16 different ones there and so forth, all merged together, all with their different cultures and problems customed to bring in more, customed not to get even fatter. Now all of those are very complex and we've obviously an interest at that first stage in one way or another, to have Nuremberg trials or whatever. Normal procedures will have to be followed, you can retrench if you have a lack of confidence or you can transfer people to the Namaqualand desert. We never promised them we wouldn't restructure and that's what we've got to start to do but we've been treading, as I said, on tiptoes around that sort of issue. The same goes for the private sector. It needs major restructuring, the private sector in South Africa. Not a revolution but restructuring. According to the London Financial Times, according to my friend Simon Barber, a Washington based journalist, both have said that the prime reason why private investors aren't pouring into South Africa from outside is not just because there's a communist in the Cabinet in the shape of Joe Slovo, it's not that there's some threat of nationalisation. The prime reason is the monopolisation of the private sector inside South Africa. There is no effective anti-shop legislation in place.
The Financial Times singled this out as the prime blockage to private investors and Simon Barber two weeks ago in the Business Day gave an interesting case study, a Texan ceramic tile manufacturer who was wanting to come in and he was just getting crowded out, Anglo was the parent company. There are many other kinds of restructurings that have to happen in the private sector as well in order for it to become RDP friendly. It's paying lip service at the moment but by and large it's not doing very much for reconstruction and development. And that's what external investors are saying, we all love South Africa, it's the flavour of the year, Mandela's great, well done, but this is the bottom line. We don't see South Africans just pouring money into housing or the infrastructure or whatever, why aren't they doing it? Why should we do it? But those things, pressure, struggle, positions in the government as well as strong trade union and civic organisations, social movements of all kinds, so as to squeeze the process, to push the process, to drive the process.
POM I talked to Derek Keys the other day about the way things were going and he was very forthright. I spoke to him two years in a row and he is optimistic about the future, far more than he was a year ago or even some months ago but he said one problem will remain and that is that there will only be one percent increase in employment per year. This is a huge problem, you have a huge amount of people who will be permanently unemployed. Do they pose a problem? Look at the promises made and not kept.
JC There are already signs of all of that. I mean the MK revolt is a part of this frustration at a less than satisfactory transformation process and I think that that's a problem. There are much more ingrained problems and a much more destructive problem is certainly unemployment, it's probably the most important problem. And I would say if Derek Keys' financial policies, that approach is the least of the problem because I think that what we've got at the moment is an ANC government that in one of the areas they are treading far too cautiously is in the area of financial and monetary policies and the current RDP white paper takes us away from the original RDP. The current white paper commits the government not to raise taxes.
Now it's true that on paper corporate tax is fairly high, 35%, but in practice the big guys pay only about 12%. They do it in the usual way, they shuffle it around. So no transformation on the tax front. The government is committing itself to cutting back on government spending whereas we found in a study last year that government spending could go up for the first three years. It would make sense to do that in order to kick start the process of reconstruction and development . We should be more cautious than that. We are committing ourselves to trying to drop government spending.
POM How so?
JC The Reserve Bank, it makes sense to have a non-partisan influence on the interim constitution. We don't want actual politicians, populist printing of money or whatever, or covering up a government blunder or something like that. So you don't want the Reserve Bank, those kind of narrow technical concerns, but the problem with the Reserve Bank is we've inherited from the past it's not independent, it's independent in its thinking but it's hand in glove with the financial sector in South Africa, five white males who are on the board of governors. Its mission statement doesn't mention the words reconstruction and development, and it's basically hand in hand with the monetarists, it's guided by a heavy handed monetarism. The moment inflation increases, inflation is the greater evil, whereas we were saying the greatest evil in South Africa is unemployment and every time they lift the interest rates, as they do, they watch the inflation rate fiercely. It sets back the possibilities of doing something about this massive unemployment rate. Now if you look at the development in the third world, whether it's China, and it's a massively growing economy, or Taiwan or South Korea, they have always used their central banks as a component of their developmental policies, so their interests rates are kept very low, huge borrowing in order to build houses or whatever purpose. It's used as an instrument for development but we've got something that's free of those concerns and so on. So that would be another example of the lack of transformation. Now I'm not talking about razing it all to the ground, I'm talking about using the resources and assets we've got, using fiscal discipline. There needs to be a non-partisan Reserve Bank. You can't tax the private sector out of existence, but I'm not talking about unintelligent, populist, but I think that we're simply accepting the near liberal economic paradigm of monetarism and financial policy in terms of other policies, fiscal policies, uncritically.
POM Would these be determined through loans from the IMF and the World Bank?
JC Well, there was a letter of conditionality signed last year in secret, which is another thing I have a serious problem with. A major letter of conditionality was signed with the IMF which leaked out into the press. But we're not into that, South Africa's balance of payments situation has huge structural problems but we're not into the era of having to sign every structural adjustments agreement in order to get loans. That again would be a manifestation of what I'm talking about, the kind of uncritical acceptance of, I wouldn't say last year's ... not this years, because even the World Bank is looking to adjust, and the World Bank study of South Africa I think is interesting and reasonably progressive. Sometimes the ANC government, the government of national unity is to the right of the World Bank on some of these issues because it's just very much the common wisdom of economics. Without asking what our priorities are, what our possibilities are, I wouldn't want what one of my comrades describes as the politicism of our movement, that the contrast in IMF negotiations and the World Trade Centre negotiations epitomises, I think we did very well by and large at the World Trade Centre for our mass base, we were politically quite sharp and mature, but we're very undeveloped on economic matters. Thank heavens we've got a Chris Liebenberg, Derek Keys or Chris Stals in the Reserve Bank on our side and we can hand it over to them, and don't really ask questions about whether the marriage of our objectives and their economics is going to work. I don't think it is going to work.
POM You say sometimes the ANC is to the right of the World Bank? Do you see any internal differences emerging particularly with regard to your own party? You can't be too happy about that.
JC I think that for the moment I put down much of what I have problems with to naivety and I'm not saying that ... I have been very underdeveloped in the area, also been very politicist in my processes, and I think that applies to others in the party as well. So we have a sense that things aren't as well as they should be but we are feeling pretty amateurish about understanding those things and having this robust ... So it sounds rather arrogant, I think a lot of it is naivety rather than a huge ground shift, ideological change for the moment, but it can quickly congeal into that. Then I think it's also born out of the kind of scene, the flavour of the year kind of thing. So Mandela is going down the Atlantic seaboard in the US and it's easy to, I don't mean personally, I mean all of us collectively, to think everyone is pulling out to bankroll the reconstruction and development programme. And I think in six months time, twelve months time, we're in for some rude shocks as much of the money is not money to us but money for US consultants or it's money in terms of arranging for European exporters or Japanese exporters and not necessarily money for South Africa. So there is a lot of euphoria around and some of it is justified and some of it is in for a rude shock.
But the first area where we clashed was Mandela, not necessarily the ANC, but with Mandela over the workers strike in July because he basically said that workers were an elite, that they shouldn't be striking and that their wage demands were selfish demands, taking away from ... that could go into the RDP. If he really said that and then we came in, there was a series of strikes, saying that clearly an endless spiral of wage demands was unsustainable and we didn't support that idea but we didn't think that was what the workers were doing. Most of the strikes were partially wage strikes and generally legitimate strikes in the sense that there had been a rise in the low inflation increases over the last few years, but they were also sort of post-electoral strikes about, "Well, we've got democracy in national politics but on the shop floor racism continues." There are racial managerial problems. So a lot of the strikes were those kind of demands as well, transformational shop floor demands. We pointed that out and called on workers to push back five of their demands and we said that there are workers in South Africa who are obviously better off by and large than the unemployed ... danger of supporting them. There is no social security net in South Africa ... another five or six unemployed people and then have an extended family on social security. So we came in on that side of the thing.
Let's go back to my earlier point about the three challenges. Yes we need to safeguard the broad national consensus we've got, we want to row the boat not rock it but to row the boat we need a governmental order to do so which is what we thought the workers strikes were about, reconstruction and development fundamentally and it was an important dimension of reconstruction and development. But there was a wobble, we have sorted it out for the most part. It was wrong but I understand the imperatives.
POM One economist wrote a couple of years ago on the question of employment.
JC I think it's a potential gain but I think that first of all the few trade unions, the federation of COSATU, has by and large been exemplary and not fighting narrow, defensive, corporatist struggles. But it was very clean and putting in place the reconstruction and development programme, it is perhaps the key driving force for the reconstruction and development programme which is all about getting jobs for the jobless, water, electricity to the most poor. These strikes they have taken up in the recent years have been against VAT, for instance, it's definitely not a narrow employed workers struggle, it was against VAT on foodstuffs which strikes the most poor more forcibly than employed workers. So that isn't the track record of COSATU. It could become that. I mean there are forces in the trade union movement that push them, COSATU is well aware of it, it struggles against the grain of that and has a track record to show for that.
Secondly, the statistics don't bear that out, that if you look at the overall salary and the wages still in the manufacturing sector of South Africa it's about - the average hourly earnings in South African manufacturers, including wages and salaries, is less than one quarter of the average pay in developed countries and about lower than one third of wages in industrialised countries. That is superior to the lower income Asian countries, Indonesia for instance. Then if you aggregate that figure because that's salaries as well as wages, white and black, the National Productivity Institute here in South Africa estimated that about 60% of that aggregate figure in manufacturing, 60% of it goes to management and supervisory salaries and 40% goes to the majority who are blue collar workers basically. They are not an elite, there's a common myth that because of trade union militancy, workers in South Africa are paid excessive wages if you compare them to Taiwan or South Korea. It's just not the case. The people who are paid excessive salaries on an international scale are black managers and white supervisors so a lot of restructuring needs to go on there. So that would be my second argument.
And my third one is about who the hell is supporting the rest, the marginalised 50% of our society? It's not the social security network, it's the employed workers. So there's a profound family connection between the employed and unemployed for the moment. Now the agenda in my view of big business in South Africa is to have partial restructuring, to transform organised labour and to strike a social accord with them, a tripartite accord, government and big business and to have a little bit of trickle down to solve the rest of the problem and it's another way of portraying the current challenge. I think that's what Derek Keys is about. The unemployment is not going to go away, I admit it's a problem but I can't see a way through it. It's Bobby Godsell's agenda, social accord, higher productivity, etc., etc., growth. You create islands of stability.
POM Do you regard the country now as being stable?
JC Relatively stable. I would say that a very significant stabilisation has occurred but it's threatened by the huge structural crisis, etc., within the country as well as within the region, but that's not talked about, but that's another significant component of what we've got to do because even if South Africa gets it right, that getting it right could be undermined by a regional crisis. So we have got to think regionally here.
POM What are the differences between central government and regional government? Regional government is complaining that ...
JC I think partly because of the frustrations of the budgetary process and the legislative process and so forth, so they are looking at frustrations at a provincial level, but they will have some federalist tendencies. I'm not mechanically opposed to federalism but we need to be very careful about balkanising South Africa because that would be another agenda which it is internationally, to invest in parts of countries where you can put in a core factory so you create pockets of profitability, but you walk away from all the national problems. We can't afford to do that here. But big capitalism has locally lots of flexibility as they call it so they are happy to try and have ambitious housing plans in parts of the PWV where there is a third world and to create a more ... but they don't want to carry the burden or marginalising ... living in the former Transkei, the Northern Transvaal or whatever. And right at the beginning when I said it attempts to be a national coherent community, the region of Southern Africa, regionally coherent programme, we've got to hold on to that and not allow market driven possibilities in pockets of South Africa with all the resources. One saw that in the PWV, a big housing developer Stocks & Stocks offered to build 30,000 houses quickly in the PWV. What worries me is that a lot of the resources available nationally in South Africa would have gone into the richest region in South Africa in a rather unsustainable way as well.
POM Do you think in the constitution there will be a lot debate over the powers to be given to the regions from the centre?
JC I think so. Yes, and I think it will be a debate in ANC institutions and provincially, and I think that ANC dominated national institutions give less than a ten out of ten rating for national Cabinet ministers. I think by and large not just provinces but in ways that we don't lose the coherence and the ability to redistribute, affirmative action, otherwise ... will just run away with the prizes and you will reproduce these actual problems. But I think you're right, there are now vested interests which are not governed. The National Party versus the ANC. Clearly there will be provinces and provincial governments in the new constitution, but the fine print ...
POM A final question, on a scale from one to ten, how would you rate the government's overall performance?
JC I'd give it a 6.2. If one were to factor in all the problems maybe you would have to rate it higher, but under the circumstances they have done quite well. 6.2, given the huge problems.
POM OK. Thanks a lot. Do you get your transcripts?
JC I do.